Pharma stocks fall on speculation over pricing policy

Shares in Indian drugmakers fall on speculation the government's final decision on the pricing policy for the sector might be more disruptive than expected.

Local media reports suggest a panel of ministers has agreed to settle on a market-based pricing mechanism, as expected, but capping drug prices at a simple average price of brands as opposed to the initial proposal of using a weighted average.

The proposal, if finalised, would be "incrementally negative" for the sector, but the impact would vary from company to company, Nomura says in a note on Thursday.